Secretary of state offers rare glimpse into talks; Steinitz, Bishara hold press conference on steps taken to boost PA economy.

After seven rounds of direct Israeli-Palestinian talks since July, Israel, the
Palestinians and the US agreed last week “to intensify the talks” and increase
US participation, Secretary of State John Kerry said.

Kerry, speaking at
a high-level meeting of the Ad Hoc Liaison Committee meeting on the sidelines of
the UN General Assembly on Wednesday, said the idea up until now was “to have
the Palestinians and Israelis meet together, work this through, build trust,
build relationship. But at the same time, we are there to facilitate, to
help if there needs to be a bridging proposal to work on the way
forward.”

Kerry’s comments seem an indication that Washington has moved
closer to the Palestinian position that greater hands-on US participation is
needed in the talks.

The secretary of state, who again stressed that he
was the only one with a mandate to discuss the negotiations, and that everything
else written or reported about the talks should be largely discounted, said the
talks were working on two tracks.

According to Kerry, that track was working
at “discerning the gaps” and defining the issues and “the parameters that they
need to work through.”

He said there was a second track that included
Netanyahu, Palestinian Authority President Mahmoud Abbas and US President Barack
Obama. “And as needed, as we think appropriate, as we need to move the process,
we will be consulting among each other and working to move this process
forward.”

Kerry said that all the final-status issues were on the table:
territory, security, refugees and Jerusalem. And, he stressed, the sides were
not seeking an interim agreement, but rather a final-status accord.

He
said one lesson he learned from previous peace making efforts was that “if you
leave things out there, hanging out there unresolved, people who don’t want
things to happen can make them not happen. And so we have to try to find a way
to get a resolution o f the fundamental choices here.”

Kerry dismissed
those saying that the nine months allotted for reaching an accord was too
optimistic a goal, saying that the sides had been negotiating these issues for
years.

“What this really needs – there’s no secret about it – to achieve
this status is a dose of courage and a reasonable level of compromise,” he
said.

Kerry praised Netanyahu and Abbas for taking political risks in
making the negotiations possible.

“Prime Minister Netanyahu is doing
something that is exceedingly difficult. Imagine any of you releasing prisoners,
let alone 104 of them at one time, over a period of time, in one fell swoop,
announcing it and dealing with the pushback from some people,” he said. “Imagine
the willingness to enter into a negotiation which obviously brings with it a
political price.”

He praised Abbas for bucking those in the Palestinian
political system saying that nothing had changed within Israel and “there was no
reason to believe this could be different” and that it would be better to pursue
their goals through the United Nations.

On economic issues, Kerry said
that Netanyahu has “bent over backwards to make things happen. He has acted in
good faith. The things he said he would do, they’re doing.”

Intelligence
Minister Yuval Steinitz spoke about the economic steps Israel had taken toward
the Palestinians, during a press conference with PA Finance Minister Shukri
Bishara.

“I share your hope that at the end of the day, maybe the entire
Middle East region will all share the same standard of living,” Stenitiz told
Bishara, before announcing the road map that the government had already
partially implemented, with the intent to bolster the Palestinian
economy.

The road map includes the 5,000 new permits that have been
issued for Palestinian workers within the Green Line, a development that was
announced at the beginning of September; exporting 4 million cubic meters of
water to the West Bank and 5 million to the Gaza Strip; exporting increased
amounts of building materials into Gaza; resuming the dialogue between the
Israeli and Palestinian finance ministries; and implementing the 2012
Steinitz-Fayyad agreement, which stipulate arrangements for transferring goods
and for taxation procedures.

Bishara agreed that the Palestinian economy
had a long way to go before it could prop up a fully functioning
state.

“We are particularly conscious of the fact that we cannot lay the
foundation of a state that is almost totally dependent on aid,” he told
reporters. “This is not a substantial economic model. It has never succeeded in
history.”

Bishara acknowledged that the PA government had “fallen into
the trap” of financing the state mostly through aid and through
borrowing.

“This is an equation that cannot be allowed to persist
anymore,” he said, especially given the chronic unemployment among Palestinian
youth. “We can survive one extra year, maybe a year and a half, but the donor
community will simply tire from this, and we cannot expect them to keep this
[aid for the Palestinian economy] as an open ended proposition.”

Bishara
said the PA had imposed an “internal time table” of 24 months in which to
achieve a basic balance for a budget. “If there is peace, I think we can move
out of total dependency on aid in a very quick period of time,” he said. “It
depends on many, many, many things. It depends on us primarily. How disciplined
we are, how focused we are, and how ready we are to take internal difficult
decisions.”

Steinitz echoed Bishara and added that Israel “has an
interest in a strong, viable and prosperous Palestinian economy, will help you
and the Palestinian economy when we can.

“We completely agree with what
Secretary Kerry said, that a better economic climate might help initiate a
better political climate. And a strong Palestinian economy is good for Israel,
and good for the general atmosphere,” Steinitz said.